Banking, insurance and financial services changes after Brexit

The United Kingdom (UK) has now left the European Union (EU). We are now in an implementation period till December 2020 which will be used to negotiate the UK’s future relationship with the EU. During the implementation period, EU law would continue to apply in the UK. Passporting will continue, as would consumer rights and protections which have been derived from EU law. Passporting refers to the regulation of financial services, allowing UK firms to continue to do business throughout the EU without the need for further authorisation.

Any new EU legislation that takes effect before the end of the implementation period will continue to apply in the UK after 31 December 2020 until the government makes changes to those laws.

Will I still be able to send or pay in Euros electronically?

Yes, the UK has maintained its participation in theSingle Euro Payments Area (SEPA). This means you’ll be able to continue to send or pay in Euros electronically.

However, you might find the time taken to process any Euro payments and transfers will increase.

If you need to make a payment by a fixed deadline, it might be a good idea to leave some extra time to have the payment processed.

I have a UK bank account. Will I be able to use my card to pay merchants in the EU and EEA?

Yes, this will not be impacted now the UK has left the EU. This is also the case if you have a bank account with a provider based in the EU or the EEA and want to use your bank card in the UK.

Existing consumer rights and protections will continue to apply when using your card as payment for goods and services.

I live in the UK. How will my insurance policies, personal pensions, annuities or other financial products from firms based in the EU or EAA be affected now the UK has left the EU?

Your coverage or product should not change because the UK has now left the EU.

This is because the government put in place legislation to enable financial services providers based in the EEA to continue providing services in the UK for a temporary period.

The Government has put in place a temporary permissions regime to allow EEA providers to operate in the UK for a period after the UK has left the EU while they get permanent FCA authorisation.

Further legislation has been made for a financial services contract regime enabling firms that do not enter the temporary permissions regime to wind down their UK business in an orderly fashion.

What’s this mean for you? Your provider should tell you if your products are affected in any way. However, contact your product provider directly if you have any concerns. When the time comes to renew your insurance, make sure you shop around to find a deal that’s right for your needs.

If you’d like advice about a financial product, you should consider speaking to a qualified financial adviser.

How do I find out where my product provider is based or authorised?

You can use the Financial Services Register to find out where a financial services provider is based or authorised, and if your financial service provider is EEA authorised.

Deposit protection

Will the Financial Services Compensation Scheme (FSCS) apply after Brexit?

The existing FSCS protection framework will continue to apply during the implementation period now the UK has left the EU up until 31 December 2020.

FSCS protection for deposits will depend on several factors including where the firm is authorised and in which jurisdiction the firm holds your deposits.

If you have any further questions you should contact your firm directly for further information.

Alternatively you can find out more about the impact of the UK leaving the EU and the Financial Services Compensation Scheme on FSCS.org.ukopens in new window and our Compensation if your bank or building society goes bust page.

I use a UK bank/building society/credit union in the UK. Will the FSCS continue to protect my money after 31 January 2020?

Yes. Eligible deposits held by UK-authorised banks, building societies and credit unions in the UK will continue to be protected by the FSCS and after the implementation period ends on the 31 December 2020, assuming the firm continues to be UK authorised.

FSCS protection is not dependent on where you’re living, but where the bank, building society or credit union holds the deposit. If a deposit is held by a branch in the UK, FSCS protection applies (unless it is a branch of a Gibraltar-based firm, in which case, protection would be the responsibility of the deposit guarantee scheme in Gibraltar).

Your bank, building society and credit union must give you an annual information sheet that describes your depositor protection. Check with your firm for more information.

Will the FSCS deposit protection limit of £85,000 be affected by UK leaving the EU with a withdrawal agreement?

There are no plans to currently revise the FSCS deposit protection limit.

Now the UK has left the EU, how will this affect the value of my stock market investments and invested pension funds?

It’s difficult to predict the impact on any individual investments because this can depend on several factors.

It’s possible there could be a period of temporary financial instability, which might mean the value of your investments in the short term could fall. Whether they fall, and how much and how long, is difficult to predict.

If you have investments and don’t require access to these funds in the immediate future, this may not be a big problem because markets are likely to recover over time.

However, if you’re planning to cash in any investments in the immediate future, get professional advice as soon as possible.

Would UK providers still be able to provide financial services to UK nationals living in the EU and EEA?

Many UK providers are taking steps so they can keep offering services to you. If your provider needs to make any changes to your product or the way it provides it, they should contact you.

If you have any concerns about whether you might be affected, you should contact your provider.

Raising a complaint to the Financial Ombudsman Service

Can I complain to the Financial Ombudsman Service?

There should be no change to complaints the Financial Ombudsman Service is able to look at.

Businesses that join the temporary permissions regime will also come under the jurisdiction of the Financial Ombudsman Service.

Will my consumer rights remain the same during the implementation period?

During the implementation period, EU law would continue to apply until 31 December 2020. The current protections and rights you have for your financial products and services wouldn’t change due to the implementation period.

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